Brown added: "Eggert Magnusson is fully committed to ensuring the club can continue its great tradition of success both on and off the field, to the benefit of supporters and the wider community."

Magnusson said: "I am both delighted and honoured that Terry Brown and his colleagues wish to support our offer for West Ham.

MAGNUSSON FACTS

Age: 59

Will become West Ham chairman

Former owner of import/export and bread & biscuit manufacturing company

Former president of Valur Reykjavik

President of Icelandic FA since 1989

On Uefa executive committee since 2002

"We can now end the uncertainty of recent weeks and move forward into the next phase of development of this great club, with Alan Pardew leading our efforts on the pitch.

"I fully appreciate the personal responsibility that will come with becoming chairman of West Ham and pledge to the staff, the players and the fans that I am here to serve and to do all that I can to deliver genuine success on and off the field."

Magnusson says he will consider moving the club from Upton Park to London's Olympic Stadium.

"In terms of the club's location we are buying what we see, which is West Ham at Upton Park," he explained.

"But if there is an opportunity to discuss a long-term move to the Olympic Stadium I would explore that.

"I recognise there will also need to be an athletics legacy from the London 2012 Olympics."

It is thought to have taken on the club's £22.5m debt, although there is no mention in the club's announcement.

Gudmundsson will assume the position of honorary life president of West Ham, while Brown will be appointed honorary life vice-president.

Magnusson, who is president of the Icelandic Football Association and is also on the Uefa executive committee, said: "Mr Gudmundsson has given me full backing and responsibility to take the club forward.

"He and I have known each other through football for many years and we share a passion for the game, particularly here in England.

"Mr Gudmundsson's commitment to the club is vital and he also believes that we can build something very special here at West Ham."

Magnusson is not expected to formally replace Brown as chairman for a couple of weeks while the deal is formally processed.

Once the deal has been finalised, Magnusson will resign from his Icelandic FA post but he could keep his place on Uefa's executive committee.

He has already met Hammers boss Alan Pardew to reassure him of his support and that he will have funds for signings in the January transfer window.

However, the futures of Carlos Tevez and Javier Mascherano look less secure.